Private corrections company loses contracts after reports of abuse

The industry and its political allies have touted private prisons as a cost-saving alternative for cash-strapped states. But these companies have not actually saved money and even cost more than state-run prisons in some cases; CCA and others have been caught overcharging states by millions of dollars and extracting guarantees of 100 percent occupancy.—Aviva Shen

States that embraced private prisons as a cost-cutting measure may want to reevaluate the decision after many reports surfaced of abuse, neglect and even fraud by Corrections Corporation of America, the largest private prison company in the nation.

The state of Idaho cut ties with Corrections Corporation of America on Wednesday. The move was reportedly motivated by accusations that CCA understaffed the prison and instead relied on prison gangs to keep order among the inmates. Furthermore, the company admitted to charging the state for 4,800 hours of security work that was not performed, according to a report by the Huffington Post.

The CCA lost contracts with two prisons in Texas, both of which had history of suspicious prisoner deaths, according to CBS Dallas. One lawsuit making its way through the court alleges that prison staff ignored calls for help from an inmate in labor. The woman was forced to give birth to her child in a toilet in her cell. The child died four days later, according to a report from the Dallas News.

Mississippi revoked CCA's contract in early June after reports of multiple riots. The Jackson Free Press reports that the riots, which left many injured and some dead, were caused by poor food and sanitation, lack of medical care, and mistreatment by guards.

"There is no reason to believe these human rights abuses are isolated," according to a blog post on the CCA by ThinkProgress staffer Aviva Shen. "CCA has faced numerous lawsuits and investigations in virtually every state where it does business," she wrote, citing fines the company has been forced to pay in Colorado for abuse and failed audits in Ohio for dirty and over-crowded facilities.

"The industry and its political allies have touted private prisons as a cost-saving alternative for cash-strapped states," wrote Shen. "But these companies have not actually saved money and even cost more than state-run prisons in some cases; CCA and others have been caught overcharging states by millions of dollars and extracting guarantees of 100 percent occupancy."

"Though states are not seeing much fiscal benefit from these deals, the industry is thriving. Many of these companies are enjoying record profits. CCA has done especially well, rebounding from the verge of bankruptcy in 2000 to boast net profits of $162 million in 2011. However, the obvious violations and bad publicity may start to tip the scale against these companies, perhaps even outweighing the massive sums the industry has spent lobbying lawmakers," wrote Shen.